Crypto asset manager Grayscale Investments hit back after the U.S. Securities and Exchange Commission (SEC) recently rejected VanEck’s application for a bitcoin spot ETF.
On November 29, the operator of Grayscale Bitcoin Trust (GBTC) sent a letter to US SEC Secretary Vanessa Countryman, saying that the US SEC was wrong to reject the spot bitcoin ETF because it had already approved three bitcoin futures ETFs , from VanEck, Valkyrie, and ProShares, respectively.
Grayscale believes that the US SEC "has no basis to show that investors can accept investing in the derivatives market of an asset instead of investing in the asset itself."
The firm alleges that the U.S. SEC violated the Administrative Protection Act (APA) by failing to treat the two bitcoin ETF products equally.
A bitcoin futures ETF allows traders to speculate on the future price of bitcoin through derivatives, while a spot bitcoin ETF allows traders to trade based on the asset's current price, so it functions similarly to holding the asset.
Grayscale is hardly a disinterested party. In October this year, Grayscale applied to list GBTC as a Bitcoin spot ETF, and may make a decision on Christmas Eve. On November 12, the US SEC rejected a similar application by VanEck on the grounds that it did not meet the requirements of the Securities Exchange Act of 1934.
Grayscale disagrees with the reasons for these denials.
“This rationale, in our view, fails to adequately consider significant regulatory and competitive developments since 2017, when the U.S. SEC first considered and denied a national securities exchange’s application to list and trade a spot bitcoin ETP.”
When approving the Bitcoin futures ETF, Grayscale believes that the US SEC allows applicants to avoid the requirements of Section 6(5)(b) of the Securities Exchange Act of 1934, while Bitcoin spot ETF applicants must comply with this requirement.
Article 6(5)(b) aims to "protect investors and the public interest" by preventing fraud and market manipulation, while also not allowing "unfair discrimination among clients, issuers, brokers or dealers".
Grayscale has predicted that its bitcoin spot ETF could launch as early as July 2022, but it is unclear whether this prediction will come true.
GBTC manages approximately US$37.1 billion in assets and has issued 692,370,100 shares.
Cointelegraph Chinese is a blockchain news information platform, and the information provided only represents the author's personal opinion, has nothing to do with the position of the Cointelegraph Chinese platform, and does not constitute any investment and financial advice. Readers are requested to establish correct currency concepts and investment concepts, and earnestly raise risk awareness.
Bitcoin struggled to maintain $40,000 amid Grayscale's $700 million outflows. Challenges arose from GBTC's transition to a spot Bitcoin ETF, triggering significant BTC sales. Despite concerns, the market showed resilience, with uncertain future trajectories and growing interest at lower price levels.
BerniceThe U.S. Securities and Exchange Commission (SEC) has prolonged the evaluation period for NYSE Arca's proposed rule change, aiming to list Grayscale Ethereum Trust shares as an exchange-traded product.
AaronSEC delays decision on Grayscale's Ethereum Trust to Jan. 25, 2024, citing the need for thorough review and addressing concerns, impacting broader cryptocurrency ETF landscape.
Huang BoGrayscale Investments is actively pursuing SEC approval for its Grayscale Bitcoin Trust's conversion into a spot bitcoin ETF. Recent discussions with the SEC revolve around NYSE Arca's proposed rule change. Grayscale's persistent efforts, court mandates, and engagements with BNY Mellon showcase its commitment. GBTC outlines plans for listing and ongoing share issuance. The broader industry, including major players like BlackRock and Fidelity, is also navigating the SEC approval process for spot bitcoin ETFs.
Huang BoThe SEC extends the deadline for Grayscale's Ethereum ETF decision until January 1, 2024, introducing uncertainty into Grayscale's strategic move, amidst a competitive landscape and evolving market dynamics.
JasperThe SEC has prolonged its scrutiny of Grayscale's Ethereum Futures Trust, a decision poised to influence the trajectory of cryptocurrency Exchange-Traded Funds (ETFs) in the US.
Catherine
JinseFinancePart Three: 3AC, Grayscale, Genesis, and DCG
EspressoFrom accusing the SEC of suppressing Bitcoin to suggesting alternatives, the community showed varied responses to Grayscale’s legal challenge against the SEC.
Cointelegraph"The value of cultural relics lies not only in appreciation and collection. Digitize antique cultural relics, and use more different forms to keep these old objects carrying cultural and historical value alive, with eternal DNA."
Ftftx
